Yatra Online, Inc. — FY2021 Form 20-F Summary
Business context and reporting period
This is Yatra Online, Inc.’s annual report for the fiscal year ended March 31, 2021, not a standalone 2020 fourth-quarter filing. The company operates primarily in India as an online travel platform serving consumers, corporate clients and travel agents. Its main reporting segments are Air Ticketing and Hotels and Packages. Financial statements are prepared under IFRS; amounts below are in Indian rupees (INR) unless noted.
Financial and operating results
- Revenue: INR 1,271.3 million, down 82.5% from INR 7,259.4 million in FY2020. Air Ticketing revenue was INR 893.0 million; Hotels and Packages revenue was INR 173.4 million.
- Adjusted Revenue: INR 2,190.6 million, down 63.4%. This is a company-defined non-IFRS measure and is not directly comparable with IFRS revenue.
- Bookings and activity: Gross Bookings fell 82.8% to INR 14.7 billion. Air passengers booked declined 68%, hotel room nights 54%, and holiday-package passengers travelled 96%.
- Margins: Reported Net Revenue Margin was 11.4% for Air Ticketing and 20.6% for Hotels and Packages, versus 5.1% and 9.9% in FY2020. The company cautions that FY2021 margins are not comparable because cancellations were unusually high relative to new bookings.
- Profitability: Operating loss widened to INR 1,470.2 million from INR 625.1 million. Net loss was INR 1,194.9 million, versus INR 840.2 million. Adjusted EBITDA loss increased to INR 378.7 million from INR 121.6 million. Basic loss per share was INR 20.38, compared with INR 17.94.
- Cash flow: Operating cash flow was positive INR 765.4 million, versus cash used of INR 550.4 million in FY2020. The improvement reflected working-capital movements, including lower receivables; it does not indicate a return to profitability. Investing activities used INR 230.4 million and financing activities provided INR 535.3 million.
- Liquidity and debt: At March 31, 2021, cash and cash equivalents were INR 1,711.6 million and term deposits INR 552.1 million, of which INR 517.5 million was pledged. Borrowings were INR 131.1 million; lease liabilities were INR 503.0 million. Management stated that available cash and expected operating cash flows should cover needs for at least 12 months.
- Balance sheet: Total assets were INR 5,747.3 million, total liabilities INR 4,584.2 million and total equity INR 1,163.1 million. Current assets were INR 4,094.7 million and current liabilities INR 3,470.1 million.
Material changes versus FY2020
- COVID-19 travel restrictions and cancellations drove a severe decline in bookings and revenue. A domestic-travel recovery early in calendar 2021 was interrupted by India’s second wave and renewed restrictions.
- Personnel expenses fell 56.2% to INR 778.9 million following headcount rationalization and salary reductions; employees declined from 2,000 to 1,006. Marketing and other operating expenses also decreased substantially.
- Goodwill impairment was INR 264.9 million, compared with INR 222.0 million in FY2020. The company also impaired INR 148.0 million of trademarks and revised the estimated useful life of acquired customer relationships, increasing amortization.
- A INR 379.0 million gain from the change in fair value of warrants reduced the reported loss; this is a valuation item, not operating cash generation.
- The company issued 14.375 million shares in a June 2020 follow-on offering and received net proceeds of approximately INR 772.2 million.
Outlook, risks and unusual items
- Management expected the COVID-19 second wave to materially affect FY2022 first-quarter revenue. It described the duration of restrictions and pace of travel recovery as uncertain; it provided no specific financial guidance.
- Cost measures included salary reductions and freezes, remote work, rent renegotiations, deferred non-critical capital spending, lower marketing spend and renegotiated supplier terms. These measures may also affect service, employee retention and operations.
- Customer refunds and supplier reimbursement capacity pose working-capital and liquidity risks. The company also cites airline and GDS commission reductions, dependence on a limited number of domestic airlines, competition, and potential longer-term reductions in business travel.
- The Ebix merger agreement was terminated in June 2020. Yatra sued Ebix and related parties seeking damages; the outcome and any recovery are uncertain, and litigation may incur costs and divert management attention.
- Tax and service-tax disputes remain significant. The audited statements disclose INR 310.1 million of service-tax claims and INR 96.6 million of income-tax claims as contingent liabilities for which no provision was recorded. The filing also describes other historical demands and appeals; amounts and procedural status should be reconciled across the notes and legal disclosures.
- The auditor issued an unqualified opinion on the IFRS financial statements. Management concluded disclosure controls and internal control over financial reporting were effective; the auditor did not attest to internal-control effectiveness because the company was an emerging growth company.
Important facts for investors to verify
- Confirm that the intended comparison is FY2021 versus FY2020: the filing does not provide a clear standalone 2020 Q4 financial summary.
- Reconcile IFRS revenue with Adjusted Revenue and assess the comparability of reported segment margins given cancellations and IFRS 15 presentation.
- Review cash availability after pledged deposits, refund obligations, lease payments and other commitments; assess the assumptions behind management’s 12-month liquidity assessment.
- Track travel-demand recovery, FY2022 results and the effect of the second COVID-19 wave and later restrictions.
- Assess the status and potential exposure of the Ebix litigation and the disclosed tax and service-tax matters, including whether any amounts are payable or recoverable.
- Review dilution and potential share supply from the follow-on offering, outstanding warrants, options and restricted or performance share units.